Filling out the Free Application for Federal Student Aid (FAFSA) form is a complicated process for students and their families. The 100+ question form asks for a variety of figures from both student and parent tax returns: income earned from work, adjusted gross income, taxes paid, interest income, and other items depending on whether deductions are itemized or on other specific factors of an individual’s filing situation. This onerous process is alleviated by the Data Retrieval Tool (DRT), a data-sharing effort between the Internal Revenue Service (IRS) and the U.S. Department of Education (ED). For the past seven years, FAFSA filers with a completed tax return could merge their information directly from the IRS to the FAFSA using DRT. This tool streamlines the process for students and families of all financial statuses.
Amid concerns about identity theft, however, the DRT is currently unavailable to students and families for “the next several weeks.” The lack of access to the DRT isn’t a simple inconvenience for FAFSA filers, it has real consequences for students and their potential access to state-funded aid programs.
- Verification selection: The loss of the DRT means that more low-income students will need to go through additional hoops to access aid. When students do not use DRT, they run the risk of being selected for a verification process . This means that they must supply their institutional financial aid office(s) with a copy of their tax transcript, requested directly from the IRS. Then, the aid office checks that the numbers entered manually on the FAFSA match the numbers from a student’s processed tax return. In most institutions, due to volume and complexity of the process, verification can take anywhere from two-four weeks.
- Compromised access to state aid: The loss of DRT means that students risk missing deadlines for state-funded aid programs. Spring time is prime time for filing FAFSAs- students across the country are currently scrambling to meet institutional and state deadlines for aid, the most common of which fall in the first week of March(during which DRT was unavailable without explanation from the IRS or ED.) Students in 19 states- California, Delaware, Idaho, Illinois, Indiana, Kansas, Kentucky, Maryland, Mississippi, Nevada, New Jersey, North Carolina, North Dakota, Oklahoma, Oregon, Texas, Vermont, Washington and West Virginia– are all experiencing compromised access to file for state aid on time due to the DRT outage.
In many postsecondary institutions, students will not know how much aid they are eligible for until their files are verified. Additionally, missing a deadline for state aid can cost them valuable aid dollars. This outage is especially problematic for low-income students who are at the highest risk for verification and missing eligibility for state-funded aid. Students and states will all be well-served by a quick restoration of DRT; while there is little to be done about state deadlines that have already passed, too many are on the horizon to risk a continued outage of DRT.
Stay tuned for more work from Education Commission of the States on state and federal collaboration in the aid application process. A new brief on reducing complexity in the form, Simplification is Not So Simple, will release on April 4, 2017.